Annex B - Uses, Limitations and Consequences of Projections

HSG/1998/5

B.1 Uses

The main use of the household projections is as part of the process of assessing future housing demand. Specifically, local authorities make widespread use of the household projections in housing plans to assess future housing need, in the structure plan process and as a context for planning approval decisions. Uses of household projections are partly determined by central government guidance (PAN 38 and NPPG3).

Projections are (or should be) only one element in assessing future housing need - in recent years, the analysis of housing market areas has become increasingly sophisticated, and factors affecting demand are also taken into account.

B.2 Limitations

The limitations of these household projections must be fully recognised. A projection is a calculation showing what happens if particular assumptions are made. The household projections are trend-based, and are not, therefore, policy-based forecasts of what the Government expects to happen. Many social and economic factors influence the formation of households, including policies adopted by both central and local government.

The household projections are based on the population projections and, as a result, assumptions used for the population projections, such as future migration, fertility and mortality, will have an effect on the household projections. Projections for areas with small populations tend to be less reliable than those for areas with large populations, especially the further into the future the projections are taken, because the former is usually affected more by migration.

Central government household projections are trend-based. However, it should be remembered that new local planning policies are often intended to modify past trends. Structure plans may be based on reasoned and agreed departures from the projections that seem better able to fit particular local circumstances.

It should be recognised that household projections, like other projections, may indicate that existing trends and policies are likely to lead to situations which are judged undesirable. If new policies are then introduced they may result in the original projections not being realised. However, this means the projections will have fulfilled one of their prime functions; to show the consequences of present trends with sufficient notice for any necessary action to be taken.

Footnote

1. This note is partly based on guidance provided on the uses and limitations of projections from 1993-based Subnational Population Projections; OPCS series PP3 no. 9 (HMSO).